Releases

WASHINGTON--(BUSINESS WIRE)--Oct. 30, 2009--
The Washington Post Company (NYSE: WPO) today reported net income of
$17.1 million ($1.81 per share) for its third quarter ended September
27, 2009, compared to net income of $10.4 million ($1.08 per share) for
the third quarter of last year.

Items included in the Company’s results for the third quarter of 2009:

$6.1 million in accelerated depreciation at The Washington Post
(after-tax impact of $3.8 million, or $0.40 per share);

A $25.4 million goodwill and other long-lived assets impairment charge
related to Kaplan Ventures (after-tax impact of $18.8 million, or
$2.00 per share); and

A decline in equity in earnings (losses) of affiliates associated with
$29.0 million in impairment charges at two of the Company’s affiliates
(after-tax impact of $18.8 million, or $2.00 per share).

Items included in the Company’s results for the third quarter of 2008:

A $59.7 million goodwill impairment charge at the Company’s community
newspapers and The Herald (after-tax impact of $41.9 million, or $4.48
per share);

$12.5 million in accelerated depreciation at The Washington Post
(after-tax impact of $7.9 million, or $0.84 per share); and

$20.6 million in non-operating unrealized foreign currency losses
arising from the strengthening of the U.S. dollar (after-tax impact of
$13.0 million, or $1.39 per share).

Revenue for the third quarter of 2009 was $1,148.7 million, up 2% from
$1,128.7 million in the third quarter of 2008. The increase is due to
revenue growth at the education and cable television divisions. Revenues
were down at the Company’s newspaper publishing, magazine publishing and
television broadcasting divisions.

Operating income increased in the third quarter of 2009 to $61.2
million, from $40.3 million in the third quarter of 2008. Excluding the
operating items discussed above, the education division reported
improved results for the quarter, and the newspaper publishing division
reported increased losses. The magazine publishing division reported an
operating loss for the third quarter, and operating results were down at
the television broadcasting division. Cable television division results
declined modestly for the third quarter of 2009.

For the first nine months of 2009, net income totaled $9.0 million
($1.08 per share), compared with $47.0 million ($4.86 per share) for the
same period of 2008.

Items included in the Company’s results for the first nine months of
2009:

$63.4 million in early retirement program expense at The Washington
Post and Newsweek (after-tax impact of $39.3 million, or $4.18 per
share);

$33.0 million in restructuring charges related to Kaplan’s Score and
Test Prep operations (after-tax impact of $20.5 million, or $2.18 per
share);

$33.8 million in accelerated depreciation at The Washington Post
(after-tax impact of $21.0 million, or $2.23 per share);

A $25.4 million goodwill and other long-lived assets impairment charge
related to Kaplan Ventures (after-tax impact of $18.8 million, or
$2.00 per share);

A decline in equity in earnings (losses) of affiliates associated with
$29.0 million in impairment charges at two of the Company’s affiliates
(after-tax impact of $18.8 million, or $2.00 per share); and

$18.4 million in non-operating unrealized foreign currency gains
arising from the weakening of the U.S. dollar (after-tax impact of
$11.4 million, or $1.21 per share).

Items included in the Company’s results for the first nine months of
2008:

Charges of $112.0 million related to early retirement program expense
at The Washington Post newspaper, the corporate office and Newsweek
(after-tax impact of $67.8 million, or $7.13 per share);

A $59.7 million goodwill impairment charge at the Company’s community
newspapers and The Herald (after-tax impact of $41.9 million, or $4.48
per share);

$13.7 million in accelerated depreciation at The Washington Post
(after-tax impact of $8.6 million, or $0.91 per share);

Expenses and charges of $3.9 million in connection with restructuring
at certain Test Prep operations (after-tax impact of $2.4 million, or
$0.26 per share);

A decline in equity in earnings (losses) of affiliates associated with
$6.8 million in impairment charges at two of the Company’s affiliates
(after-tax impact of $4.1 million, or $0.43 per share); and

$13.4 million in non-operating unrealized foreign currency losses
arising from the strengthening of the U.S. dollar (after-tax impact of
$8.4 million, or $0.89 per share).

Revenue for the first nine months of 2009 was $3,331.3 million, up 1%
from $3,298.0 in the first nine months of 2008, due to increased
revenues at the Company’s education and cable television divisions,
partially offset by revenue declines at the Company’s newspaper
publishing, magazine publishing and television broadcasting divisions.

The Company reported operating income of $47.8 million for the first
nine months of 2009, compared to operating income of $112.0 million for
the first nine months of 2008. Excluding the operating items discussed
above, the education division reported improved results for the period,
and the newspaper publishing and magazine publishing divisions reported
increased losses. Operating results were down at the television
broadcasting division, while the cable television division reported
improved results for the period.

The Company’s operating income for the third quarter and first nine
months of 2009 included $2.3 million and $5.2 million of net pension
credits, respectively, compared to $6.4 million and $19.6 million of net
pension credits, respectively, for the same periods of 2008, excluding
charges related to early retirement programs.

Division Results

Education

Education division revenue totaled $684.5 million for the third quarter
of 2009, a 14% increase over revenue of $602.7 million for the same
period of 2008. Kaplan reported operating income of $45.9 million for
the third quarter of 2009, down 10% from $51.1 million in the third
quarter of 2008. Results for the third quarter of 2009 included a
goodwill and other long-lived assets impairment charge of $25.4 million
related to two businesses at Kaplan Ventures.

For the first nine months of 2009, education division revenue totaled
$1,927.4 million, a 12% increase over revenue of $1,722.5 million for
the same period of 2008. Kaplan reported operating income of $115.2
million for the first nine months of 2009, down 21% from $145.3 million
for the first nine months of 2008.

Kaplan completed a reorganization of its organizational and internal
reporting structure during the third quarter of 2009. As a result, the
Company has made changes to the composition of its reporting segments. A
summary of Kaplan’s operating results reported under this new structure
for the third quarter and the first nine months of 2009 compared to 2008
is as follows:

Third Quarter

YTD

(In thousands)

%

%

2009

2008

Change

2009

2008

Change

Revenue

Higher education

$

408,658

$

302,026

35

$

1,119,142

$

837,064

34

Test prep, excluding Score

109,319

122,109

(10

)

333,848

366,287

(9

)

Score

206

7,518

(97

)

8,557

23,982

(64

)

Kaplan international

138,089

141,895

(3

)

382,066

407,402

(6

)

Kaplan ventures

30,459

31,815

(4

)

90,897

93,108

(2

)

Kaplan corporate

315

371

(15

)

967

1,058

(9

)

Intersegment elimination

(2,530

)

(2,995

)

–

(8,108

)

(6,442

)

–

$

684,516

$

602,739

14

$

1,927,369

$

1,722,459

12

Operating income (loss)

Higher education

$

88,737

$

45,927

93

$

199,934

$

128,949

55

Test prep, excluding Score

5,028

16,363

(69

)

24,004

45,051

(47

)

Score

(371

)

(2,268

)

–

(36,539

)

(7,834

)

–

Kaplan international

8,311

10,825

(23

)

27,304

34,519

(21

)

Kaplan ventures

(7,611

)

(2,311

)

–

(12,997

)

(1,367

)

–

Kaplan corporate

(15,577

)

(11,477

)

(36

)

(38,984

)

(33,546

)

(16

)

Kaplan stock compensation

(1,697

)

(2,515

)

33

(5,155

)

(9,798

)

47

Amortization of intangible assets

(5,617

)

(3,151

)

(78

)

(17,247

)

(10,503

)

(64

)

Impairment of goodwill and other long-lived assets

(25,387

)

–

–

(25,387

)

–

–

Intersegment elimination

84

(267

)

–

236

(193

)

–

$

45,900

$

51,126

(10

)

$

115,169

$

145,278

(21

)

Kaplan Higher Education (KHE) includes Kaplan’s domestic post-secondary
education businesses, made up of fixed-facility colleges as well as
online post-secondary and career programs. Higher education revenue grew
35% for the third quarter of 2009 and 34% for the first nine months of
2009 due mostly to strong enrollment growth. Operating income at KHE
improved 93% in the third quarter of 2009, reflecting this strong
enrollment growth. Operating income increased 55% for the first nine
months of 2009 due to this strong enrollment growth, offset by increased
marketing and advertising costs in the first quarter of 2009, including
a $21.0 million national media campaign. At September 30, 2009, KHE’s
enrollments totaled 103,800, a 28% increase compared to total
enrollments of 81,400 at September 30, 2008. Enrollment growth was
particularly strong at Kaplan University’s online offerings, which grew
at 37% in the first nine months of 2009.

Test prep includes Kaplan’s standardized test preparation and tutoring
offerings, as well as the professional domestic training business, K12
and other businesses. Test prep revenue, excluding Score and revenue
from acquired businesses, declined 11% in the third quarter and 9% in
the first nine months of 2009 due to continued revenue declines in the
real estate and financial education businesses, declines at the
traditional test prep programs and softness in other programs. Test prep
operating income, excluding Score, was also down in the third quarter
and first nine months of 2009 due to declines at the traditional test
prep programs and softness in other programs, offset by improved results
at test prep’s professional domestic training businesses due to expense
reductions.

At the end of March 2009, the Company approved a plan to offer tutoring
services, previously provided at Score, in Kaplan test prep centers. The
plan was substantially completed by the end of the second quarter of
2009; 14 existing Score centers were converted into Kaplan test prep
centers and the remaining 64 Score centers were closed. Score revenues
declined to $8.6 million in the first nine months of 2009, from $24.0 in
the first nine months of 2008. Operating losses at Score increased to
$36.5 million in the first nine months of 2009, inclusive of $24.9
million in restructuring-related charges, compared to $7.8 million in
operating losses for the first nine months of 2008.

In 2007, Kaplan announced restructuring plans at its professional
domestic training businesses that involved product changes and
decentralization of certain operations, in addition to employee
terminations. These businesses are now part of Kaplan’s test prep
division. In the fourth quarter of 2008, Kaplan expanded this
restructuring to include additional operations. Total
restructuring-related expenses of $0.9 million and $8.1 million were
recorded in the third quarter and first nine months of 2009,
respectively, related to lease termination, accelerated depreciation of
fixed assets and severance costs, compared to $0.7 million and $3.9
million in restructuring-related severance costs recorded in the third
quarter and first nine months of 2008, respectively.

Kaplan International includes professional training and post-secondary
education businesses outside the United States, as well as
English-language programs. Kaplan International revenue declined 3% in
the third quarter of 2009 and 6% in the first nine months of 2009.
Excluding revenue from acquired businesses, Kaplan International revenue
was down 9% for the third quarter of 2009 and 11% in the first nine
months of 2009. The declines are the result of unfavorable exchange
rates in the U.K., Europe and Australia and declines in English-language
programs. These declines were offset by revenue growth at
International’s Asian operations. Likewise, Kaplan International
operating income is down largely due to weakness in the English-language
programs and the financial education programs in the U.K., offset by
improved operating results at International’s Asian operations.

Kaplan Ventures is made up of a number of businesses in various stages
of development that are managed separately from the other education
businesses. Kaplan Ventures includes Kaplan EduNeering, Kaplan
Compliance Solutions, Education Connection, Kaplan Virtual Education,
Kidum and other smaller businesses. Revenues at Kaplan Ventures declined
4% in the third quarter and 2% in the first nine months of 2009. Kaplan
Ventures reported operating losses of $7.6 million and $13.0 million for
the third quarter and first nine months of 2009, compared to operating
losses of $2.3 million and $1.4 million for the same periods of 2008,
due primarily to increased losses at Kaplan Virtual Education, a
developing group of online high school institutions. A goodwill and
other long-lived assets impairment charge of $25.4 million was recorded
at Kaplan in the third quarter of 2009 related to certain of the Kaplan
Venture’s businesses, as the book value of these businesses exceeded
their estimated fair value.

Cable television division revenue of $189.6 million for the third
quarter of 2009 represents a 4% increase from $181.8 million in the
third quarter of 2008; for the first nine months of 2009, revenue
increased 5% to $559.8 million, from $535.0 million in the same period
of 2008. The 2009 revenue increase is due to continued growth in the
division’s cable modem and telephone revenues, and a $4 monthly rate
increase for most basic subscribers in June 2009.

Cable division operating income declined 3% to $40.3 million in the
third quarter of 2009, versus $41.6 million in the third quarter of
2008; cable division operating income for the first nine months of 2009
increased 5% to $122.1 million, from $116.0 million for the first nine
months of 2008. The decline in operating income in the third quarter of
2009 is due to increased programming, bad debt and general and
administrative costs. The increase in operating income for the first
nine months of 2009 is the result of the division’s revenue growth.

At September 30, 2009, Revenue Generating Units (RGUs) grew 1% due to
continued growth in high-speed data and telephony subscribers, partially
offset by a reduction in basic and digital subscribers. A summary of
RGUs is as follows:

September 30,

September 30,

Cable Television Division
Subscribers

2009

2008

Basic

677,751

701,711

Digital

221,564

224,231

High-speed data

388,567

368,614

Telephony

105,211

90,994

Total

1,393,093

1,385,550

Newspaper Publishing

Newspaper publishing division revenue totaled $156.3 million for the
third quarter of 2009, a decrease of 20% from $196.2 million in the
third quarter of 2008; division revenue decreased 19% to $485.9 million
for the first nine months of 2009, from $599.6 million for the first
nine months of 2008. Print advertising revenue at The Post in the third
quarter of 2009 declined 28% to $70.0 million, from $97.2 million in the
third quarter of 2008, and decreased 27% to $224.4 million for the first
nine months of 2009, from $308.6 million in the same period of 2008. The
print revenue decline in 2009 is due to large decreases in classified,
general, zones and retail advertising. Revenue generated by the
Company's newspaper online publishing activities, primarily
washingtonpost.com, declined 18% to $22.6 million for the third quarter
of 2009, versus $27.4 million for the third quarter of 2008; newspaper
online revenues declined 12% to $68.1 million in the first nine months
of 2009, versus $77.3 million for the first nine months of 2008. Display
online advertising revenue declined 14% and 4% for the third quarter and
first nine months of 2009, respectively. Online classified advertising
revenue on washingtonpost.com declined 27% and 26% for the third quarter
and first nine months of 2009, respectively.

For the first nine months of 2009, Post daily and Sunday circulation
declined 3.6% and 3.7%, respectively, compared to the same periods of
the prior year. For the nine months ended September 27, 2009, average
daily circulation at The Post totaled 600,800 and average Sunday
circulation totaled 840,100.

As previously announced, the Company offered a Voluntary Retirement
Incentive Program to certain employees of The Washington Post newspaper
in the first quarter of 2009. A total of 221 employees accepted the
offer, and early retirement program expense of $56.8 million was
recorded in the second quarter of 2009, which is being funded primarily
from the assets of the Company’s pension plans. In the third quarter of
2009, the Company offered a Voluntary Retirement Incentive Program to
certain employees at Robinson Terminal Warehouse Corporation; $1.1
million in early retirement program expense was recorded in the third
quarter of 2009, also to be funded from the assets of the Company’s
pension plans. In the first quarter of 2008, a Voluntary Retirement
Incentive Program was also offered, with 231 employees accepting the
offer; $79.8 million in early retirement program expense was recorded in
the second quarter of 2008, also funded primarily from the assets of the
Company’s pension plans.

The Post closed its College Park, MD, printing plant in July 2009 and
has consolidated its printing operations in Springfield, VA. The Post is
also in the process of consolidating certain other operations in
Washington, DC. In connection with these activities, accelerated
depreciation of $6.1 million and $33.8 million was recorded in the third
quarter and first nine months of 2009, respectively; accelerated
depreciation of $12.5 million and $13.7 million was recorded in the
third quarter and first nine months of 2008, respectively. The Company
will incur additional costs related to the shutdown of the College Park,
MD printing plant that will be recorded as incurred. The Company also
expects to incur a loss on an office lease in conjunction with the
consolidation of operations. A portion of the loss may be recorded in
the fourth quarter of 2009 and the remainder in 2010, depending on the
timing of the consolidation. Additionally, in the third quarter of 2008,
the Company completed an impairment review of its community newspapers
and The Herald, which resulted in a $59.7 million goodwill impairment
loss.

The newspaper division reported an operating loss of $23.6 million in
the third quarter of 2009, compared to an operating loss of $82.7
million in the third quarter of 2008. For the first nine months of 2009,
the newspaper division reported an operating loss of $166.7 million,
compared to an operating loss of $178.3 million for the first nine
months of 2008. Excluding early retirement program charges, accelerated
depreciation and goodwill impairment losses, operating results declined
in the third quarter and first nine months of 2009 due to the
significant decline in division advertising revenue and increased bad
debt expense, offset by expense reductions. Newsprint expense was down
37% and 19% for the third quarter and first nine months of 2009,
respectively, due to a decline in newsprint consumption and prices.

A summary of newspaper division operating results for the third quarter
and the first nine months of 2009 compared to 2008 is as follows:

Third Quarter

Year-to-Date

(In thousands)

2009

2008

%

Change

2009

2008

%

Change

Operating revenues

$156,281

$196,217

(20

)

$485,937

$599,593

(19

)

Operating expenses, excluding special charges

(172,675

)

*

(206,807

)

*

(17

)

(560,942

)

*

(624,716

)

*

(10

)

(16,394

)

*

(10,590

)

*

(55

)

(75,005

)

*

(25,123

)

*

–

Early retirement program expense

(1,124

)

–

–

(57,924

)

(79,800

)

–

Goodwill impairment charge

–

(59,690

)

–

–

(59,690

)

–

Accelerated depreciation

(6,104

)

(12,469

)

–

(33,792

)

(13,682

)

–

Operating loss

$(23,622

)

$(82,749

)

71

$(166,721

)

$(178,295

)

6

*Non-GAAP measure

Television Broadcasting

Revenue for the television broadcasting division decreased 17% in the
third quarter of 2009 to $64.6 million, from $78.0 million in 2008; for
the first nine months of 2009, revenue decreased 19% to $192.4 million,
from $238.5 million in 2008. The decrease in revenue is due to weaker
advertising demand in all markets and most product categories,
particularly automotive; political advertising revenue also declined by
$3.9 million and $7.1 million for the third quarter and first nine
months of 2009, respectively. Additionally, in the third quarter of
2008, the television broadcasting division benefited from $6.3 million
in incremental summer Olympics-related advertising at the Company’s NBC
affiliates.

In the third quarter of 2008, the television broadcasting division
recorded $4.9 million in non-cash property, plant and equipment gains as
a reduction to expense due to new digital equipment received at no cost
from Sprint/Nextel in connection with an FCC mandate reallocating a
portion of the broadcast spectrum in order to eliminate interference
with public safety wireless communication systems.

Operating income for the third quarter of 2009 declined 50% to $15.1
million, from $30.1 million in 2008; operating income for the first nine
months of 2009 declined 52% to $41.5 million, from $86.4 million in
2008. The operating income declines for the third quarter and first nine
months of 2009 are due to the revenue decreases discussed above and the
$4.9 million in non-cash gains in the third quarter of 2008.

Magazine Publishing

Revenue for the magazine publishing division totaled $40.2 million in
the third quarter of 2009, a 33% decrease from $60.0 million in the
third quarter of 2008; division revenue totaled $131.8 million for the
first nine months of 2009, a 25% decrease from $176.0 million in the
first nine months of 2008. The decline is due to a 48% and 38% reduction
in advertising revenue at Newsweek for the third quarter and first nine
months of 2009, respectively, resulting from fewer ad pages at both the
domestic and international editions. In February 2009, Newsweek
announced a circulation rate base reduction at its domestic edition,
from 2.6 million to 1.5 million, by January 2010.

As previously announced, Newsweek offered a Voluntary Retirement
Incentive Program to certain employees in November 2008 and 44 employees
accepted the offer in the first quarter of 2009; early retirement
program expense of $6.6 million was recorded in the first quarter of
2009, which is being funded primarily from the assets of the Company’s
pension plans. In the first quarter of 2008, Newsweek also offered a
Voluntary Retirement Incentive Program to certain employees and 117
employees accepted the offer. The early retirement program expense in
2008 totaled $29.2 million, also funded primarily from the assets of the
Company’s pension plans. Of this amount, $24.6 million was recorded in
the first quarter of 2008 and $4.6 million was recorded in the second
quarter of 2008. In the third quarter of 2009, Newsweek continued to
implement cost savings initiatives at its operations and $2.7 million in
severance costs were recorded. Additional costs savings initiatives are
underway that are expected to result in added charges in the fourth
quarter of 2009.

The division had an operating loss of $4.3 million in the third quarter
of 2009, compared to operating income of $9.0 million in the third
quarter of 2008; the division had an operating loss of $29.7 million for
the first nine months of 2009, compared to an operating loss of $27.0
million for the first nine months of 2008. Excluding early retirement
program expense, the division’s operating loss increased in the third
quarter and first nine months of 2009 due to the revenue reductions
discussed above and a reduced pension credit, offset by a decline in
subscription and editorial expenses at the domestic edition of Newsweek.

Other Businesses and Corporate Office

Other businesses and corporate office included the expenses of the
Company’s corporate office and the operating results of Avenue100 Media
Solutions (formerly CourseAdvisor). The 2008 results include $3.0
million in early retirement program expense at the corporate office
recorded in the second quarter.

Equity in (Losses) Earnings of Affiliates

The Company’s equity in losses of affiliates for the third quarter of
2009 was $27.1 million, compared to losses of $0.6 million for the third
quarter of 2008. For the first nine months of 2009, the Company’s equity
in losses of affiliates totaled $28.2 million, compared to losses of
$9.5 million for the same period of 2008.

Results for the third quarter of 2009 include $29.0 million in
write-downs at two of the Company’s affiliate investments. The loss
primarily relates to an impairment charge recorded on the Company’s
interest in Bowater Mersey Paper Company, as a result of the challenging
economic environment for newsprint producers. Results for the first nine
months of 2008 included $6.8 million in impairment charges at two of the
Company’s affiliates.

The Company holds a 49% interest in Bowater Mersey Paper Company and
interests in several other affiliates.

Other Non-Operating Income (Expense)

The Company recorded other non-operating income, net, of $0.1 million
for the third quarter of 2009, compared to other non-operating expense,
net, of $21.1 million for the third quarter of 2008. The third quarter
2008 non-operating expense, net, included $20.6 million in unrealized
foreign currency losses.

The Company recorded other non-operating income, net, of $15.8 million
for the first nine months of 2009, compared to other non-operating
expense, net, of $14.1 million for the same period of the prior year.
The 2009 non-operating income, net, included $18.4 million in unrealized
foreign currency gains, offset by $2.9 million in impairment write-downs
on cost method investments and other items. The 2008 non-operating
expense, net, included $13.4 million in unrealized foreign currency
losses.

As noted above, a large part of the Company’s non-operating income
(expense) is from unrealized foreign currency gains or losses arising
from the translation of British pound and Australian dollar-denominated
intercompany loans into U.S. dollars. The unrealized foreign currency
gains in the first nine months of 2009 were the result of a weakening of
the U.S. dollar against the British pound and the Australian dollar in
the first nine months of 2009, versus the exchange rates in effect at
the end of 2008. The unrealized foreign currency losses in the first
nine months of 2008 were the result of a strengthening of the U.S.
dollar against the British pound and the Australian dollar in the first
nine months of 2008, versus the exchange rates in effect at the end of
2007.

Net Interest Expense

The Company incurred net interest expense of $7.0 million and $21.3
million for the third quarter and first nine months of 2009,
respectively, compared to $5.7 million and $15.0 million for the same
periods of 2008. The increases are due to a decline in interest income,
as well as higher average interest rates in the first nine months of
2009 versus the same period of the prior year. At September 27, 2009,
the Company had $399.1 million in borrowings outstanding at an average
interest rate of 7.2%.

Provision for Income Taxes

The effective tax rate for the third quarter and first nine months of
2009 was 37.2% and 36.7%, respectively. The low effective tax rates for
both of these periods are due primarily to favorable adjustments
recorded in the third quarter of 2009 for a reduction in state income
taxes and for prior year permanent federal tax deductions, offset by
$8.5 million of nondeductible goodwill in connection with the impairment
charge related to Kaplan Ventures recorded in the third quarter of 2009.

The effective tax rate for the third quarter and first nine months of
2008 was 19.5% and 36.0%, respectively. The low effective tax rate for
both of these periods is due to a reduction in state income taxes and a
favorable $4.6 million provision to return adjustment from 2007, offset
by $5.9 million of nondeductible goodwill in connection with the
impairment charge recorded in the third quarter of 2008.

Earnings Per Share

The calculation of diluted earnings per share for the third quarter and
first nine months of 2009 was based on 9,401,010 and 9,399,501 weighted
average shares outstanding, respectively, compared to 9,358,096 and
9,458,193, respectively, for the third quarter and first nine months of
2008. In the first quarter of 2009, the Company repurchased 3,359 shares
of its Class B common stock at a cost of $1.4 million from recipients of
vested awards of restricted shares at market price.

Forward-Looking Statements

This report contains certain forward-looking statements that are based
largely on the Company’s current expectations. Forward-looking
statements are subject to certain risks and uncertainties that could
cause actual results and achievements to differ materially from those
expressed in the forward-looking statements. For more information about
these forward-looking statements and related risks, please refer to the
section titled “Forward-Looking Statements” in Part I of the Company’s
Annual Report on Form 10-K.

THE WASHINGTON POST COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except share and per share amounts)

Third Quarter

%

Change

2009

2008

Operating revenues

$

1,148,711

$

1,128,658

2

Operating expenses

(985,230

)

(950,265

)

4

Depreciation

(70,094

)

(73,524

)

(5

)

Amortization of intangible assets

(6,767

)

(4,912

)

38

Impairment of goodwill and other long-lived assets

(25,387

)

(59,690

)

(57

)

Operating income

61,233

40,267

52

Equity in losses of affiliates, net

(27,192

)

(609

)

--

Interest income

555

1,173

(53

)

Interest expense

(7,533

)

(6,882

)

9

Other income (expense), net

103

(21,083

)

--

Income before income taxes

27,166

12,866

--

Provision for income taxes

(10,100

)

(2,500

)

--

Net income

17,066

10,366

65

Net loss (income) attributable to noncontrolling interest

214

(37

)

--

Net income attributable to The Washington Post Company

17,280

10,329

67

Redeemable preferred stock dividends

(230

)

(236

)

(3

)

Net income available for common stock

$

17,050

$

10,093

69

Basic earnings per share

$

1.81

$

1.08

68

Diluted earnings per share

$

1.81

$

1.08

68

Basic average shares outstanding

9,340,067

9,334,057

Diluted average shares outstanding

9,401,010

9,358,096

THE WASHINGTON POST COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except share and per share amounts)

Year-to-Date

%

Change

2009

2008

Operating revenues

$

3,331,299

$

3,298,015

1

Operating expenses

(3,005,847

)

(2,915,106

)

3

Depreciation

(231,651

)

(195,463

)

19

Amortization of intangible assets

(20,606

)

(15,804

)

30

Impairment of goodwill and other long-lived assets

(25,387

)

(59,690

)

(57

)

Operating income

47,808

111,952

(57

)

Equity in losses of affiliates, net

(28,160

)

(9,505

)

--

Interest income

1,838

4,555

(60

)

Interest expense

(23,114

)

(19,514

)

18

Other income (expense), net

15,779

(14,052

)

--

Income before income taxes

14,151

73,436

(81

)

Provision for income taxes

(5,200

)

(26,400

)

(80

)

Net income

8,951

47,036

(81

)

Net loss (income) attributable to noncontrolling interest

2,108

(141

)

--

Net income attributable to The Washington Post Company

11,059

46,895

(76

)

Redeemable preferred stock dividends

(928

)

(946

)

(2

)

Net income available for common stock

$

10,131

$

45,949

(78

)

Basic earnings per share

$

1.08

$

4.87

(78

)

Diluted earnings per share

$

1.08

$

4.86

(78

)

Basic average shares outstanding

9,339,646

9,432,642

Diluted average shares outstanding

9,399,501

9,458,193

THE WASHINGTON POST COMPANY

BUSINESS SEGMENT INFORMATION

(Unaudited)

(In thousands)

Third Quarter

%

Change

Year-to-Date

%

Change

2009

2008

2009

2008

Operating Revenues:

Education

$

684,516

$

602,739

14

$

1,927,369

$

1,722,459

12

Cable television

189,647

181,840

4

559,839

535,011

5

Newspaper publishing

156,281

196,217

(20

)

485,937

599,593

(19

)

Television broadcasting

64,599

78,003

(17

)

192,415

238,507

(19

)

Magazine publishing

40,167

59,969

(33

)

131,776

176,043

(25

)

Other businesses and corporate office

15,314

11,534

33

39,290

30,134

30

Intersegment elimination

(1,813

)

(1,644

)

(10

)

(5,327

)

(3,732

)

(43

)

$

1,148,711

$

1,128,658

2

$

3,331,299

$

3,298,015

1

Operating Expenses:

Education

$

638,616

$

551,613

16

$

1,812,200

$

1,577,181

15

Cable television

149,318

140,215

6

437,691

418,996

4

Newspaper publishing

179,903

278,966

(36

)

652,658

777,888

(16

)

Television broadcasting

49,547

47,895

3

150,952

152,143

(1

)

Magazine publishing

44,481

50,925

(13

)

161,462

203,045

(20

)

Other businesses and corporate office

27,426

20,421

34

73,855

60,542

22

Intersegment elimination

(1,813

)

(1,644

)

(10

)

(5,327

)

(3,732

)

(43

)

$

1,087,478

$

1,088,391

0

$

3,283,491

$

3,186,063

3

Operating Income (Loss):

Education

$

45,900

$

51,126

(10

)

$

115,169

$

145,278

(21

)

Cable television

40,329

41,625

(3

)

122,148

116,015

5

Newspaper publishing

(23,622

)

(82,749

)

71

(166,721

)

(178,295

)

6

Television broadcasting

15,052

30,108

(50

)

41,463

86,364

(52

)

Magazine publishing

(4,314

)

9,044

--

(29,686

)

(27,002

)

(10

)

Other businesses and corporate office

(12,112

)

(8,887

)

(36

)

(34,565

)

(30,408

)

(14

)

$

61,233

$

40,267

52

$

47,808

$

111,952

(57

)

Depreciation:

Education

$

19,017

$

16,390

16

$

61,099

$

49,171

24

Cable television

30,800

30,524

1

92,998

92,091

1

Newspaper publishing

15,352

23,596

(35

)

64,861

45,481

43

Television broadcasting

3,528

2,361

49

9,458

6,831

38

Magazine publishing

1,197

504

--

2,672

1,553

72

Other businesses and corporate office

200

149

34

563

336

68

$

70,094

$

73,524

(5

)

$

231,651

$

195,463

19

Amortization of intangible assets and impairment of goodwill
and other long-lived assets